Global stocks give up chunk of US-China trade truce gains

LONDON (AP) - Global stock markets gave up Tuesday many of the gains they recorded in the previous session when a 90-day trade tariff truce between the U.S. and China shored up investor sentiment.

KEEPING SCORE: In Europe, Germany's DAX was down 0.8 percent to 11,377 while France's CAC 40 fell 0.8 percent to 5,016. The FTSE 100 index of leading British shares was also 0.8 percent lower at 7,005. U.S. stocks were poised for a lower opening with Dow futures and the broader S&P 500 futures down 0.5 percent.

US-CHINA TRUCE: A weekend meeting between U.S. President Donald Trump and Chinese President Xi Jinping that ended with a verbal agreement to hold off on further tariffs for at least 90 days had sent stocks soaring on Monday. On Monday, Treasury Secretary Steven Mnuchin told reporters that the leaders had detailed conversations on 142 items and will need to turn those pointers into a "real agreement" in the coming months. Some of the move lower in markets Tuesday was just day-to-day profit-taking. However, some of it shows a degree of skepticism about the prospects of the truce lasting beyond the 90 days.

ANALYST TAKE: "This may be a little harsh as a deal isn't necessary in the 90-day window, the two sides just need to agree on the parameters of a future deal and what will be included in order to extend the truce and work towards removing tariffs," said Craig Erlam, senior market analyst at OANDA. "Whether this will happen is certainly up for debate but I do believe that this is a positive step forward from where we were prior to the meeting and that's the important thing."

BREXIT: The pound has spiked higher after a top official at the European Union's highest court advised that Britain can unilaterally change its mind about leaving the EU. The advice of the advocate general, which is often but not always followed by the full court, triggered a rebound in the pound as investors priced in a higher possibility of Britain not leaving the European Union as scheduled on March 29. The pound was up 0.7 percent at $1.2811 following the news.

THE QUOTE: "With some clamoring for a second referendum, the pound is spiking on the prospect that Brexit may never happen at all," said Joshua Mahony, Market Analyst at IG.

A currency trader watches monitors at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, Dec. 4, 2018. Asian shares were mostly lower Tuesday as investors wondered if a 90-day tariff truce was enough for the U.S. and China to resolve a range of issues from technology development to trade. (AP Photo/Ahn Young-joon)

ASIA'S DAY: Japan's Nikkei 225 index gave up 2.4 percent to 22,036.05 and the Kospi in South Korea lost 0.8 percent to 2,114.35. Hong Kong's Hang Seng added 0.3 percent to 27,260.44. The Shanghai Composite index picked up 0.4 percent to 2,665.96. Both Chinese indexes finished more than 2 percent higher on Monday. The S&P ASX/200 in Australia gave up 1 percent to 5,713.10.

ENERGY: Oil prices are rallying ahead of an OPEC meeting on Thursday, where members are expected to agree to cut output in 2019. Benchmark U.S. crude advanced 92 cents to $53.87 per barrel in electronic trading on the New York Mercantile Exchange while Brent crude rose $1.195 cents to $62.88 per barrel.

CURRENCIES: The euro was up 0.4 percent at $1.1399 while the dollar fell 0.8 percent to 112.78 yen.

A currency trader watches his mobile phone at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, Dec. 4, 2018. Asian shares were mostly lower Tuesday as investors wondered if a 90-day tariff truce was enough for the U.S. and China to resolve a range of issues from technology development to trade. (AP Photo/Ahn Young-joon)

Currency traders work at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, Dec. 4, 2018. Asian shares were mostly lower Tuesday as investors wondered if a 90-day tariff truce was enough for the U.S. and China to resolve a range of issues from technology development to trade. (AP Photo/Ahn Young-joon)

Currency traders watch monitors at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Tuesday, Dec. 4, 2018. Asian shares were mostly lower Tuesday as investors wondered if a 90-day tariff truce was enough for the U.S. and China to resolve a range of issues from technology development to trade. (AP Photo/Ahn Young-joon)

A board above the floor of the New York Stock Exchange shows the closing number for the Dow Jones industrial average, Monday, Dec. 3, 2018. Stocks finished solidly higher on Wall Street as investors welcomed news of a 90-day truce in the trade battle between the U.S. and China. (AP Photo/Richard Drew)